President of raSmith (Brookfield, WI), a multi-disciplinary firm of civil engineers, structural engineers, land surveyors, development managers, landscape architects, and ecologists.
By Liisa Andreassen Correspondent
When Smith joined raSmith, he didn’t know it would turn into a long-term career. He initially had his eye on investment banking and his plan was to spend two years at raSmith and then return to graduate school to pursue an MBA. But when he started working on a large mall development in Pittsburgh, he took a liking to the magnitude of the work and the ability to interact with clients. Today, he has more than 18 years of civil engineering experience leading teams in the design of lifestyle centers, regional malls, and large format retail developments.
“In order to be a good leader and run a solid business, I have to hire people I can trust, people who will push me to become better at my job and people who will make raSmith a better company,” Smith says. “I believe in playing to people’s strengths and carving out roles for individuals that will allow their strongest skills to shine. I don’t believe everyone needs to be good at everything.”
A conversation with Ricky Smith.
The Zweig Letter: raSmith is a family-owned firm. Did you always know you’d work in the family business? Was engineering your passion from the get-go or was there ever a different career trajectory you considered?
Ricky Smith: Honestly, I didn’t know that I wanted to work at raSmith until after I graduated college. I majored in civil engineering and economics and also took all of the required classes for pre-med because I was unsure of what I wanted to do. When I graduated, I became interested in the financial services industry, specifically investment banking, but found it incredibly difficult to find a job with a large bank in New York City. As my job search continued, the director of the land development services division at raSmith called and offered me a position as I had interned in the division during the previous summer. Looking back, it’s funny because my father didn’t know that I was going to be offered a position to work in his company until after I had already accepted the offer.
TZL: What role does your family play in your career? Are work and family separate, or is there overlap?
RS: When you work in a family business there’s no separation between work and family. Part of this is of course working with family, but another big portion of this is that being the president of a company is a 24-hour responsibility. I’m constantly thinking about how to best take care of our clients and how to create opportunities for our employees that will enable them to advance in their careers and support their families. The end of the work day usually marks the time I can begin to think and strategize about how raSmith can evolve for the better.
TZL: Trust is crucial. How do you earn the trust of your clients?
RS: Earning the trust of clients starts with being honest and ends with fulfilling our firm’s commitments. If we make a mistake, we admit it, we rectify the situation, and we move forward. At the end of the day our job is to make our clients lives’ easier and solve their problems. We pride ourselves on being a trusted advisor. We regularly receive feedback from clients whose trust we’ve earned and that’s a major reason why they continue to work with us. They know our people and they know what to expect when they work with us – quality work completed in a timely manner.
TZL: How has COVID affected your business on a daily basis?
RS: COVID has changed the way we do business. raSmith went from essentially not allowing remote work to encouraging all office personnel to work remotely. At present, about two-thirds of our office staff work remotely. COVID forced us to rapidly develop guidelines, safety practices and capacity limits to do our best to ensure that everyone in the company was kept safe and healthy. We’ve also implemented a system to track and manage staff who are impacted by COVID. We have to ensure that we conduct appropriate contact tracing and ensure that our people who are impacted are made aware of the federal and state benefits, in addition to our corporate benefits, to ensure that they and their families are taken care of in their time of need.
TZL: What type of leader do you consider yourself to be?
RS: In order to be a good leader and run a solid business, I have to hire people I can trust, people who will push me to become better at my job and people who will make raSmith a better company. I believe in playing to people’s strengths and carving out roles for individuals that will allow their strongest skills to shine. I don’t believe everyone needs to be good at everything. For example, if an engineer really likes to develop grading plans and can complete them more efficiently than anyone else, they should not be forced to spend their time practicing writing stormwater management reports. I would pair such a person with someone who is equally good at stormwater management reports, and both individuals would be happier. The client is happy too because their project is being designed quickly, efficiently, and under budget.
TZL: Ownership transition can be tricky, to say the least. What’s the key to ensuring a smooth passing of the baton? What’s the biggest pitfall to avoid?
RS: First, it’s important to separate ownership from leadership and not confuse the two – which can be difficult at times. Second, you have to ensure that the individuals or entities to whom you are transferring ownership have like-minded philosophies and visions for the firm. In a service firm, people are your greatest asset, so the last thing an owner would want to do is transfer his/her company to a new owner who will destroy its culture and create issues for its employees and clients by providing directives to leadership that may be counter to a firm’s culture or practices. Third, one has to try to be unemotional about the process and make decisions based on logic rather than emotions and feelings.
The greatest pitfall to avoid is starting a transition process without being completely ready to commit to it. Ownership transitions require a tremendous amount of time and resources for both the purchaser and seller. If a party’s words do not match their actions, you can end up spending an enormous amount of time on a process without making any progress. In the long run, this can take away from other areas of a business requiring significant attention and do potential harm.
TZL: They say failure is a great teacher. What’s the biggest lesson you’ve had to learn the hard way?
RS: You can never take your success for granted; there will always be challenges and setbacks. At the same time, when those challenges and setbacks occur you must keep moving forward because things are never as bad as they seem.
In 2010, less than one year into becoming director of the land development services division at raSmith, our relationship with our biggest client, which accounted for 33 percent of our division’s revenue, ended. I was devastated; I thought my career and the future of the land development services division were ruined. My father, who was president of the company at the time, called me and calmly said to me that in business these things happen and that you just need to move forward. I had no choice but to work hard. By the end of the year, we as a division had made up all of the lost revenue from that client – something that I never thought was possible so soon.
TZL: Since being named president in 2018, what’s been your greatest challenge and greatest achievement? Why?
RS: My greatest challenge has resulted in my greatest achievement – preparing raSmith for the possibility of a recession in 2020. We did not financially overextend, so we have not had to reduce staff or salaries. In the midst of record corporate revenue and profit levels, telling our firm’s managers that I believed we needed to hunker down and prepare for a recession was not easy. However, in 2019 we were in the midst of the longest economic expansion in U.S. history, which meant that we were much closer to it ending than starting. And, the labor market was way too tight; hiring experienced engineers was difficult. Even co-ops and new graduates turned down job offers at the highest rate in our firm’s 40-year history. If companies can’t hire people, they can’t grow and the economy will suffer. I considered these factors warning signs for the overall economy. As a result, we slowed down hiring new staff, reduced capital expenditures, and paid off debt in 2019 instead of looking to rapidly expand.
TZL: The firm has three founding principles: stability, quality, and innovation. Can you give me an example of something the firm has done recently to hold true to each of those principles?
RS: Our firm lives and breathes these three founding principles every single day. Our commitment to stability is exemplified by our firm’s commitments to our clients and our employees regardless of external conditions such as pandemics or recessions. Throughout the COVID-19 pandemic, we’ve continued to meet our clients’ project needs and provide uninterrupted service. Our commitment to quality and innovation is practiced every minute of every day. Our success is dependent on our ability to solve our clients’ problems and make their lives easier. And, we constantly have to innovate and do things better and more efficiently today than we did yesterday. In business, if you’re not improving and innovating, you’re falling behind.
TZL: In one word or phrase, what do you describe as your number one job responsibility as CEO?
RS: Taking care of people (employees and clients).
TZL: A firm’s longevity is valuable. What are you doing to encourage your staff to stick around?
RS: As an organization, we do everything we can to treat our people well, fully recognizing that every single employee makes a conscious choice each day to work for raSmith. As a service organization, we understand our people are our product and our company’s most valuable resource.
What differentiates raSmith from our competitors and has allowed us to have an incredibly low turnover rate is the fact that we emphasize work-life balance. We listen to the thoughts, ideas and concerns of all of our people, and as an organization, continue to grow, creating opportunities for people to advance in their careers at raSmith.Click here to read this week's issue of The Zweig Letter.